How one company is tackling soaring loan production costs
“That brought our cost basis down to 80% against what the cost is to get a verification versus a legacy competitor,” he said. “Instead of that $100 to $200 verification charge, now you’re $30 to $40. That broker is now deploying technology that helps them be competitive, but also is saving them costs, and ultimately could be saving their borrowers on a closing.”
He said the savings extend beyond the verification fee itself. The speed of completing the verification also increases with improved technology.
“It’s all public points now where our lenders are seeing 10-day faster cycle times,” he said. “They’re getting a person’s verification income and employment report. We’re giving them that, plus pay stubs and W-2s, actual documents from the source. So fraud goes out the door, and it’s a cleaner process overall.”
Giving brokers an alternative
Fraud has been a growing concern, especially as non-agency lending has increased. According to Hardesty, that same direct-source approach applies to borrowers who fall outside traditional agency lending.
“That non-QM segment has been a very growing segment in the last year,” he said. “We heard our lenders say these non-QM buyers basically need to see actual bank statements. So now you can connect into your bank account, and we’ll pull back the bank statements direct to source.”
